When it’s time to get a car, you might be wondering what options are best for you. Should you purchase a car and make payments until you own it, or should you lease a car and rent it? This is a question a lot of people wonder about, especially when it feels overwhelming to go to a car dealership, knowing someone will try to sell you something. With this info, you can decide whether you’d rather buy or lease your vehicle without worrying about the extra details.
When you own a car, the maintenance is on you. Plenty of car-enthusiasts choose to buy a vehicle because for them, it’s a fun hobby to spend hours in the garage and learn about the mechanics of their car. However, not everyone cares about fully understanding their car’s insides, and it can be a hassle to head to the mechanic and hope you don’t get overcharged.
Although it always depends on the specific lender and contract, a leased vehicle often comes with a warranty. That is, any major maintenance is simply not your problem. Likewise, a leased vehicle is often new enough that maintenance is not even a big concern, so you can simply enjoy your clean and comfortable vehicle.
Selling Your Car
Should you choose to buy your vehicle, you’ll have full ownership. When you’re ready to get another vehicle, you have complete freedom to sell the one you own. This isn’t the same with leasing, as you’re simply paying a monthly fee each month to use a vehicle that someone else owns.
So, if you can’t sell the car you’re leasing, why should you consider leasing as a viable option? Well, it turns out that selling a car is a very complicated process. If you buy a vehicle knowing you’ll want to sell it again later, you may have to limit your options to a model you know will be in demand later. You’ll also have to consider regular, documented maintenance so you can prove the car is in good condition for the next buyer. Additionally, it’s unlikely anyone will want to pay a lot of money for a used car.
When you lease, you don’t have to worry about any of these problems. Your lender deals with them instead, so you can simply enjoy renting your vehicle until you’re ready to lease a different model.
Buying a car can involve paying a large sum of money that you simply can’t get back. The resale value of your car goes down as soon as you buy it. It’s no longer a new car, and you continue to put wear and tear into it every day. With a leased car, this depreciation in value is factored into your monthly payments. Depending on your contract, you’ll have lower payments every month without worrying about your car’s re-sale value. Instead, that’s a concern for the lender.
If you purchase a car but have to make payments every month, you’ll eventually own the title. With a leased car, you’re only renting the vehicle and will never own it unless you make an agreement with the lender. However, your monthly payments will likely be lower than that of someone who loaned money to purchase their vehicle, and you can walk away when the lease is over. However, leased cars do have a monthly mileage limit and you will pay fees if you go over that limit. With that in mind, it’s very reasonable to assume you’ll stay within your limits with average driving habits. Although leased vehicles often have a high termination fee, it’s a much better alternative than spending countless dollars on a vehicle you are stuck with and responsible for.